The Worst Misconception About Advisors and Elder Financial Abuse

The Worst Misconception About Advisors and Elder Financial Abuse

Jan 30, 2017 | aging, diminished cognition, elder investor, elderly, financial elder abuse, scammers

Imagine this: your aging client is 86 years old, slightly grumpy, and he thinks he knows better than just about everyone else on nearly everything. He's quite willing to follow your advice, though and that's what makes a good relationship with him.

 

Lately, he's got you worried. He is obsessed with the internet. He spends many hours a day on it and he tells you about this man he met online who has an amazing investment he wants to get into. When he starts telling you about it, it sounds like a scam of the worst kind. You warn him not to do it and he says you don't understand.

 

He asks you to liquidate one of his investments you manage. You do it. He tells you how happy he is that he's got this great thing going now. A month later he calls you and wants to liquidate a lot of his funds to raise some significant cash for his "friend" who has the scammer-sounding "investment". You say, "don't do this!" He won't follow your advice. This is new, and puzzling. What should you do?

 

Rules tell you that you must follow your client's instruction and that you are not supposed to reveal his financial information to anyone. Should you call Adult Protective Services? Can you? You are not sure what to do.

 

Here's the answer: you are permitted to report financial elder abuse. According to the regulators' Interagency Guidance on Privacy Laws and Reporting Financial Abuse of Older Persons, which discusses the issue in detail, you are also permitted to disclose this information to protect against or prevent actual or potential fraud.

 

But what if your client think his internet "friend" is fine even if you are seeing telltale signs of fraud in your client's interactions with the scammer? You can report the apparent crime in an online form to the FBI as long as you know enough detail from your client. I think anyone who suspects internet fraud should do this, even if it turns out to be some legitimate thing in the end. It probably isn't. And your client's money could all be gone if you do nothing. Would that be okay with you?

 

Financial professionals need to be clear about your role in preventing and stopping elder abuse. Law enforcement can't always stop the criminals but sometimes they do. No one can stop what is never reported to them. Do not be misled by the misconception that protecting your client's private information is supposed to stop you from reporting apparent fraud and abuse.

 

You could be the difference between your client's safety and your client being wiped out financially. Take a deeper dive and get very smart in an accredited one hour online course about stopping financial abuse. Click here now.

Carolyn Rosenblatt, R.N., Elder Law Attorney & Dr. Mikol Davis

co-founders of AgingInvestor.com and AgingParents.com

 

A Lurking Danger You Need To Warn Your Clients About

A Lurking Danger You Need To Warn Your Clients About

Jan 12, 2017 | aging, aging investor, Alzheimer's disease, diminished cognition, elder investor, elderly, finances for elders, financial advisors, financial capacity, financial elder abuse, financial judgement, handling money for seniors, investor, scammers, senior citizen investor, senior investor, seniors finances, wealth transfer

A Lurking Danger You Need To Warn Your Clients About

There is nothing wrong with putting on a dinner or lunch for prospects while you give them a pitch about a product you like. But unfortunately, a free meal brings people out, especially older folks and they become sales targets for unscrupulous people. FINRA, in seeing how these seminars are too often a vehicle for fraud and exaggeration preying on unsuspecting elders, has issued a warning to seniors. You can be the messenger to provide a heads-up for your own clients about this.

Too many unethical people are using the setting of a free lunch to sell inappropriate investments.  The annuity scams are notorious for this. And the scammers love impaired elders who are so easy to fool.

As people age, about a third of them will develop Alzheimer’s Disease. Most of the victims of this insidious disease are women.  When the earliest signs of the disease emerge, research tells us that impairment of financial judgment is already underway. The predators have no trouble talking a senior who lacks the ability to see a scam coming into buying whatever they're selling. It happens every day, not just in the free lunch seminar.

FINRA's alert for investors about “free lunch” investment seminars is specific. Your older clients might not get that alert unless it comes through you. Here’s the gist of what FINRA wants seniors to know.

The FINRA Investor Education Foundation researched people over 40 to find out how many have been solicited with offers for a free meal seminar.  64 percent of respondents had been solicited, which means that the odds are, your clients will be among them. What the research also showed was that half of the sales materials contained claims that were apparently exaggerated, misleading or otherwise unwarranted. 13 percent of these seminars appeared to involve fraud, such as unfounded projections of returns and sales of nonexistent products

Slick and unscrupulous “advisors” and sellers have been at this for years, pitching unsuitable products. They’ve stepped up their game as the population ages. They want every target they can get. An easy way to warn your clients is to give them a one-sheet Client Update we have created for you. Get yours here or by clicking below and send it out to everyone in your book of business. Some of them are older clients and some have aging parents or grandparents who need to know about this.

You'll look good by showing that you care about what happens to your clients and they'll appreciate the message.

You can improve your expertise with your older clients in a book written especially for you, Succeed With Senior Clients, A Financial Advisor's Guide to Best Practices. Get your copy by clicking here.

Carolyn Rosenblatt, RN, Elder Law Attorney, AgingInvestor.com and AgingParents.com

Great handout: client update on the Free Lunch Investment Seminar

Click HERE To Download

Aging Clients and Secrecy About Finances

Aging Clients and Secrecy About Finances

Jan 5, 2017 | aging, aging investor, diminished cognition, elder investor, finances for elders, power of attorney, senior investor, seniors finances

Have you ever had a stubborn older client who told you he'd never talk about his assets with anyone but you? He doesn't think he'll ever need help in his life and he wants to be in charge. When you suggest a family meeting to let someone else know what to do in case he ever became ill and unable to communicate, he shuts you down.   This is all too common.

A consistent obstacle to communication we see in our work is the resistance of the older person to discuss finances with anyone, including their adult children or other heirs. The Great Depression led to secrecy about finances for many, as fortunes were lost sometimes overnight and once proud people became impoverished. Talking openly about money was just not done for those who grew up in this time of widespread devastating and sometimes life-ending financial losses. To this segment of our population, openly discussing money was considered rude, unseemly. Some of these Depression-era survivors remain reluctant to tell anyone in their families where their accounts are, what their assets are and what they want done with their assets in the event of incapacity.

Presumably when you have a long-term relationship with your client, she trusts you and trusts your judgment. That gives you leverage. You may know more about her finances than her family, her friends or anyone in her life. You are charged with the task of long range planning and you look ahead. In doing so, it is up to you to urge your client, gently, repeatedly and with ongoing persistence that she find someone she can trust to appoint to protect her if she has an accident, falls ill, or can't speak for herself.

Sometimes persistence pays. The power of your relationship is a tool to persuade your client to come around. This is not a situation to ignore just because your client resists. The older she is, the more there is at risk. Anything can happen to her health at any time.

If your client resists, we encourage you to repeat your requesting a week or a month. Do it in a tactful way and paint a verbal picture for her of what would happen if she were no longer able to speak for herself. Tell her how frustrating it would be to have to refer her account to your legal department for a decision about getting a court involved if she could no longer communicate. Tell her how upset that would make you feel. Express your own concerns and make it your problem.

We hope that every single person in your book of business has an appointed trusted other for you to contact. You may well need that and it can be up to you to urge your client to take care of that most important piece of legal business, the Durable Power of Attorney, if she has not done this. Diminished capacity can sneak up on your client and you'll need help.

It's a new role you have with the oldest clients. They are living longer than they thought they would and with longevity come the risks of impairment in all ways.

If you'd like to take a little deeper dive into managing clients with diminished capacity, you can get a lot of expertise in a one hour online course by clicking here.

By Carolyn Rosenblatt, RN, Elder Law Attorney

AgingParents.com and AgingInvestor.com

3 Ways To Talk With Aging Parents About Finances

3 Ways To Talk With Aging Parents About Finances

Dec 2, 2016 | aging, elder investor, handling money for aging parents, handling money for seniors, senior citizen investor, senior investor, seniors finances

3 Ways To Talk With Aging Parents About Finances

One benefit of the increasing life expectancies for Americans is that more people have bonus years for enjoying the company of their aging parents.

But all is not rosy. Those extended years also boost the odds that parents could go broke or suffer from dementia and be unable to make financial decisions for themselves.

That can leave adult children perplexed about when and whether they should step in and find out what’s happening with their parents’ money, says Carolyn Rosenblatt, a registered nurse and elder law attorney.

“Unfortunately, it’s not always easy to have those conversations,” says Rosenblatt, co-author with her husband, Dr. Mikol Davis, of The Family Guide to Aging Parents (www.agingparents.com) and Succeed With Senior Clients: A Financial Advisors Guide To Best Practices.

“Some stubborn parents just refuse to talk about their money. No matter what their adult children say to them, they put it off, change the subject or tell their children it’s none of their business.”

Of course, many adult children aren’t in any particular hurry to broach the subject either, says Davis, a clinical psychologist and gerontologist.

“They have their own discomfort about it and procrastinate,” he says. “Then a crisis comes up and no one has any idea what the parents have or where to find important documents.”

But Rosenblatt and Davis say it’s critical that these conversations take place so that the offspring can gather information about such subjects as the parent’s income and expenses, where legal documents are kept, and what kind of medical or long-term-care insurance the parent might have.

The success of these conversations often comes down to how you approach the subject, Rosenblatt and Davis say. They offer a few tips:

  • End the procrastination by picking a date for the talk. Make an appointment with yourself to bring up the subject at a specific time. An opportune time to schedule this is after a birthday, a family event or a holiday where other family members are together who may share in the responsibility for the aging parents in the future.
  • Show respect. Tell your parents you understand and respect their reluctance to discuss their finances. You can even make the conversation about yourself rather than about them. Say that you’re concerned that if something went wrong, you would be completely lost as to how to help them.
  • Address their fears head-on. Let them know you understand they are worried that if they talk about their finances their independence might be taken away. You might add that you want them to maintain their independence as long as possible and you’re willing to help accomplish that, but you can’t do it without the correct information.

“Getting past an aging parent’s fear about talking about finances can be daunting,” Rosenblatt says. “But a well-planned strategy for approaching the subject will give you your best chance.”

 

About Carolyn Rosenblatt and Dr. Mikol Davis

Carolyn Rosenblatt and Dr. Mikol Davis are co-authors of The Family Guide to Aging Parents (www.agingparents.com) and Succeed With Senior Clients: A Financial Advisors Guide To Best Practices. Rosenblatt, a registered nurse and elder law attorney, has more than 45 years combined experience in her professions. She has been quoted in the New York Times, Wall Street Journal, Money magazine and many other publications. Davis, a clinical psychologist and gerontologist, has more than 44 years experience as a mental health provider. In addition to serving his patients, Davis creates online courses and products to assist professionals and the public with understanding aging issues. Rosenblatt and Davis have been married for 34 years.

 

Proving Value to Retired Clients: Creating a Financial & Personal Checklist

Proving Value to Retired Clients: Creating a Financial & Personal Checklist

Oct 28, 2016 | aging, aging investor, elder investor, elderly, finances for elders, financial advisors, handling money for seniors, investor, senior investor, seniors finances

Proving Value to Retired Clients: Creating a Financial Checklist

Many of us in this society have a very negative image about aging in general. We don't want to be "old". It is fueled by advertising on TV, movies, print media and other outlets with a consistent message: aging is bad, being younger and turning back the clock is good.  We are a work ethic driven culture. When we are older and no longer "productive" we are generally seen as less valuable.

Then there is the fear and denial about dying and death.  Our culture has been called the only one in the world that thinks of death as something optional.  Note how we talk about it to family--"in case anything ever happens to me... Besides it being a fantasy that maybe something" won't happen to us, it keeps us from planning, from preparing our loved ones and from being responsible about our older years, possible declining health and the burden ignoring these things can put on our families.  Reaching retirement age is a time to do planning about more than money.

Financial advisors are in the planning business.  You look ahead, analyze, budget and calculate. But your clients may not be on the same page in your view of the future.  They are busy being in denial that they may ever get ill and die.  You can help them.  In doing so, it may also make your job of talking about such issues as long term care, budgeting and spending easier.

Most people do not want to burden their loved ones. Most of them do not want to trouble adult children unnecessarily as they age. That is your best selling point for bringing up the personal matters.  These include how every senior and every retiree needs to plan for things in their own lives that go beyond how much money they've saved and how it will be spent having a great retirement.

Here at AgingInvestor.com we see the messes people leave behind when they nurture the Great American Fantasy that losing independence won't happen to them and that they will live happily to age 100 and die peacefully in their sleep.  Family members can spend years cleaning up the disaster their older loved ones leave because of failure to plan and take care of business.  It is truly not fair to anyone.  It leads to anger, resentment, family conflicts and sometimes to loss of wealth through ignorance. We've heard it and seen it countless times.  We put a checklist together to help people avoid these disasters created by the fantasy.

What Can You Do About It?

You can give your clients this checklist next time you sit with them and review the portfolio.  You can gently urge them to do what the list says is needed. We've broken down the essentials into 10 points, a "to do" list if you will. You can encourage them to take care of the items on the list, if they haven't already.  In general, the to do list includes updating the estate plan, having critical documents in the right hands, providing necessary financial, computer and account information to trusted family and having a family meeting to educate one's heirs about the older person's affairs. This is how your client gets a family ready. This is how they avoid unduly burdening anyone. This is how they free their loved ones from distress and unnecessary work when they have to take action as an aging parent declines and passes away.

Some of your clients will brush off your suggestion. They love that Great American Fantasy and aren't about to give it up. Others will thank you as they have thanked us and will go forward.  Their families will be forever grateful.  You'll look like the caring, smart and responsible planner that you are.

Get your free Ebook and the Financial & Personal Checklist For Smart Retirees, click HERE.

By Carolyn Rosenblatt, RN, Elder Law Attorney, AgingInvestor.comclick-here